Tuesday, 30 September 2014
Last updated 17 min ago
Mar 9 2011 | 12:03pm ET
Hermitage Capital Management has sued Russia's Interior Ministry, accusing it of abuse of power.
According to the hedge fund, once one of the largest foreign investors in Russia, the ministry had no basis for launching a tax investigation of Hermitage in 2007. Hermitage claims that Interior Ministry officials used the pretense of that investigation to raid the hedge fund's offices and seize documents that they later used to defraud the Russian government of US$230 million in taxes paid by Hermitage.
The tax evasion probe eventually led to the arrest of a Russian lawyer for Hermitage, Sergei Magnitsky, who died in prison in 2009 awaiting trial. Magnitsky, who had been jailed for nearly a year, had complained about mistreatment and the withholding of medical care; Russian human rights activists have said he was tortured.
The probe also led Russia in 2009 to put Hermitage founder William Browder on Interpol's international wanted list, four years after first barring him from entering the country. Browder had been an outspoken critic of Russian corporate governance.
"This lawsuit aims to strike a major blow against those government officials who blatantly misuse their position and status," Browder said of the claim, filed in Russia's Constitutional Court. "Thousands of businesses have been targeted by corrupt Interior Ministry officials in Russia who use fabricated tax claims to extort money, terrorize people and falsely arrest them."
Browder said he is not necessarily sanguine about winning the case, but hopes it will lead to the overturning of a 2003 presidential decree giving the Interior Ministry the authority to launch criminal tax probes.
Meanwhile, British Prime Minister David Cameron last week weighed in on Magnitsky's death, promising, like his predecessor, to raise the issue with Russian officials. No one has been charged in connection with the 37-year-old lawyer's death.
"I have now been briefed about the case and am deeply concerned by its implications for the rule of law and respect for human rights in Russia," Cameron wrote in a letter to Browder. "I discussed the case with Russian Foreign Minister Sergei Lavrov when I met him" last month, and the premier promised to follow the case in advance of his planned visit to Russia later this year.
Cameron's predecessor, Gordon Brown, also said he raised the issue shortly after Magnitsky's death in late 2009.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Sep 30 2014 | 9:29am ET
The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…
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